Numerous media outlets have reported all or part of Sen. John McCain's statement rebuking Sen. Barack Obama for his decision to forgo public financing in the general election without mentioning that during the primary, McCain signed a loan that could have forced him to remain in the race -- even if he had no chance of winning -- in order to be eligible for public matching funds to repay the loan.

Numerous media outlets have reported all or part of Sen. John McCain's statement rebuking Sen. Barack Obama for his decision to forgo public financing in the general election without mentioning that during the primary, McCain signed a loan agreement that could have forced him to remain in the race -- even if he had no chance of winning -- in order to be eligible for public matching funds to repay the loan. The New York Times has described the loan as being "secured in part by the promise of federal matching money for the primaries." Nor did these reports point out that Federal Election Commission (FEC) chairman David Mason has taken the position that McCain cannot legally opt out of public financing for the primary without FEC approval and that in the same letter, Mason asked the McCain campaign to expand upon its assertion that it had not "pledged the certification of Matching Payment funds as security for private financing." If McCain's campaign is not allowed to withdraw from the public financing system and if it is found to have raised and spent money beyond public financing limits, its actions "could put McCain at risk of stiff fines and up to five years in prison," according to The Washington Post.

Of Obama's decision, McCain told reporters on June 19, "This is a big deal. It's a big deal. He has completely reversed himself and gone back not on his word to me, but the commitment that he made to the American people. That's disturbing." Outlets reporting on McCain's statement but not mentioning McCain's loan include: The New York Times, the Los Angeles Times, The Philadelphia Inquirer, the CBS Evening News, NBC's Nightly News, Fox News' Special Report, and CNN, in a report by senior political correspondent Candy Crowley that aired on the 4 p.m. and 6 p.m. ET hours of The Situation Room, as well as on Lou Dobbs Tonight and Anderson Cooper 360.

By contrast, Associated Press writer Jim Kuhnhenn reported in a June 19 article about Obama's decision and McCain's response:

McCain and Obama both declined public financing in the primary contests, thus avoiding the spending limits that come with the money. McCain had initially applied for the money, however, and has been in a dispute with the Federal Election Commission over whether he needed its approval to decline the funds. The FEC insists that he does, but has not had a quorum to act because four of its six seats have been vacant pending Senate confirmation of presidential nominees. McCain lawyers have disputed the need for FEC approval.

The government's top campaign finance regulator says John McCain can't drop out of the primary election's public financing system until he answers questions about a loan he obtained to kickstart his once faltering presidential campaign.

Federal Election Commission Chairman David Mason, in a letter to McCain this week, said the all-but-certain Republican nominee needs to assure the commission that he did not use the promise of public money to help secure a $4 million line of credit he obtained in November.

Mr. Obama's decision, which had long been expected given his record-breaking money-raising prowess during the Democratic primary season, was immediately criticized by Mr. McCain, who confirmed Thursday that he would accept public financing.

"This is a big, big deal," said Mr. McCain, of Arizona, who was touring flooded areas in Iowa. "He has completely reversed himself and gone back, not on his word to me, but the commitment he made to the American people."

Mr. Obama's advisers said Thursday that they believed he could raise $200 million to $300 million for the general election, not counting money raised for the Democratic National Committee, if he were freed from the shackles of accepting public money.

McCain said Thursday that he would accept public financing, meaning he will be restricted to $84.1 million in direct spending in the two months between the Republican convention and election day.

He accused Obama of breaking a promise to abide by the federal spending limit. "This is a big deal, a big deal," McCain said. "He has completely reversed himself and gone back, not on his word to me, but the commitment he made to the American people."

Obama's ambitions are evident in a TV spot he rolled out Thursday. Called "Country I Love," the 60-second ad is airing in 18 states, many of which -- including Colorado, Georgia, North Carolina and Virginia -- voted Republican in the 2004 presidential contest.

McCain, known for backing campaign-finance legislation, first said yesterday that he was unsure whether he, too, would opt out. By afternoon, though, he told reporters in Minnesota: "We will take public financing."

Along with the Republican Party and other groups, McCain blasted Obama for opting out, saying that the Democrat "has completely reversed himself and gone back, not on his word to me, but the commitment he made to the American people."

Said Republican National Committee chairman Mike Duncan: "Obama's decision is what we've come to expect from a candidate whose rhetoric is nothing like his record, and it undermines his own claims to represent a new kind of politics."

From the June 19 edition of the CBS Evening News with Katie Couric:

RUSS MITCHELL (guest anchor): Now, let's take a look at the presidential race. Barack Obama abandoned a campaign pledge today when he announced he will forgo federal funding, worth some $84 million. He figures he can raise a lot more on his own. In doing that, he'll become the first major candidate to turn down public money since the program was set up in the mid-'70s. Here's Dean Reynolds.

[begin video clip]

REYNOLDS: Given Obama's fundraising prowess, forgoing federal money was not a big surprise, nor was the attempt to make it seem in line with the change he advocates.

OBAMA: I'm asking you to try to do something that's never been done before: declare our independence from a broken system and run the type of campaign that reflects the grassroot values that have already changed our politics and brought us this far.

REYNOLDS: But it is a big reversal. Only months ago, Obama was signaling a willingness to preserve public financing. No wonder John McCain smelled a flip-flop.

McCAIN: This is a big deal. It's a big deal. He has completely reversed himself and gone back not on his word to me, but the commitment that he made to the American people. That's disturbing.

REYNOLDS: And yet Obama's camp believes the $84 million that public financing offers can be easily surpassed by its computerized network of 1.5 million donors. From January 2007 to April of this year, Obama raised $266 million to McCain's 93 million. For Obama, raising at least 100 million more is probably doable.

KENNETH VOGEL (Politico reporter): In which he'll be able to spend money and compete in all 50 states, even those that have not traditionally favored Democrats.

REYNOLDS: Obama indicated he's opting out of the system to have enough money to fight the unlimited spending and what he called the smears from unregulated Republican-allied organizations, such as the Swift Boat group which attacked John Kerry in 2004.

OBAMA: And we face opponents who've become masters at gaming this broken system.

REYNOLDS: But McCain, on a campaign swing through flood-ravaged Iowa, said Obama's new position should make people think twice.

McCAIN: This election is about a lot of things, but it's also about trust, and it's also whether you can take people's word.

[end video clip]

REYNOLDS: Senator McCain said late today that he will accept public financing and live within its limits, though in a year that has become very difficult for Republican fundraising, it's doubtful that he himself could have drummed up much more money than what the public system is offering him. Russ.

MITCHELL: Dean Reynolds in Chicago, thanks.

From the June 19 edition of NBC's Nightly News with Brian Williams:

ANN CURRY (guest anchor): Now to presidential politics. Barack Obama today became the first candidate to opt out of accepting public financing for his general election campaign. Public financing was put in place more than three decades ago after the Watergate scandal, and Obama's decision created a firestorm today. NBC's Andrea Mitchell now reports.

OBAMA: The public financing of presidential elections as it is exists today is broken, and we face opponents who've become masters at gaming this broken system.

MITCHELL: Now, instead of getting $85 million from the government to campaign next fall, he can raise hundreds of millions online, overwhelming John McCain, who said today he will stick to the limits for the general election. McCain in Iowa today.

McCAIN: He has completely reversed himself and gone back not on his word to me, but the commitment that he made to the American people. That's disturbing.

MITCHELL: In fact, Obama did promise to observe the limits if his opponent did, checking yes on this questionnaire last November. In February, Tim Russert pressed him on whether he'd keep that pledge.

TIM RUSSERT (debate moderator): So you may opt out of public financing. You may break your word?

OBAMA: What I've said is at the point where I'm the nominee, at the point where it's appropriate, I will sit down with John McCain and make sure that we have a system that works for everybody.

MITCHELL: Obama is already swamping McCain 225 million to 77 million. Only today, Obama launched a new ad in 18 states, including Republican strongholds.

OBAMA: I approved this message because I'll never forget those values.

MITCHELL: Obama's campaign says that's to counter McCain, who wrapped up his nomination months ago. And they charge McCain himself waffled on this, applying for public funds during the primaries, then withdrawing from the public system during the nomination fight. All this will likely end a campaign finance system McCain once fought to save, as the Internet enables any candidate, not just the rich, to spend unlimited dollars if they can inspire a large following online.

Democratic presidential candidate Barack Obama today reversed course and said he will not take public funds to pay for his presidential campaign. That sparked howls of criticism, but as chief political correspondent Carl Cameron reports, it was not a surprise.

[begin video clip]

CAMERON: Having shattered all fundraising records, Barack Obama's announcement was widely expected. He'll raise his own general election money and therefore have no spending limitations.

OBAMA: We've made the decision not to participate in the public financing system for the general election. This means we'll be forgoing more than $80 million in public funds during final months of this election.

CAMERON: On a tour of the flood-ravaged Midwest, John McCain called it a flip-flop.

McCAIN: He has completely reversed himself and gone back not on his word to me, but the commitment that he made to the American people. That's disturbing.

CAMERON: Obama was asked in a November 2007 Midwest Democracy Network questionnaire if he'd forgo private funding in the general election and accept public financing. He answered simply, "Yes. I've been a long-time advocate for public financing of campaigns." And this was Obama just two months ago on Fox News Sunday.

OBAMA: I would be very interested in pursuing public financing.

CAMERON: Obama becomes the first presidential candidate since the 1970s Watergate era, when the new rules were created, to opt out of the public finance system. McCain attacked the heart of Obama's claim to be a new kind of politician.

McCAIN: This election is about a lot of things, but it's also about trust, and it's also whether you can take people's word.

CAMERON: Obama's raised more than twice what McCain has during the primaries and has nearly twice the cash on hand, which, by law, may not be spent after the candidates' nominating conventions. Obama's got another $10 million banked for his campaign after the convention and is expected to raise at least $200 million more, which would more than double the $84.1 million dollars that McCain will receive in public funds.

It's a 2-to-1 Obama advantage and a flip-flop Obama tries to justify by arguing he'll need it to counter what he predicts will be millions in attack ads by independent GOP groups trying to help McCain.

COOPER: Well, by far the most explosive story today in the presidential race was Barack Obama's decision to turn down federal financing.

His announcement sent the spin machines into overdrive on all sides, frankly. Republicans say he's flip-flopping. And it is a change of position for Senator Obama, no doubt about it. He claims the system is broken and works against Democrats. And that's why he says he's not doing it.

Now, whether you support the move or oppose it, one thing most observers agree on: By doing this, Obama has all but guaranteed himself a big financial edge.

CNN's Candy Crowley has all the "Raw Politics."

[begin video clip]

CROWLEY: If you raise more than a quarter-billion dollars in the primary season, would you limit yourself to $85 million in the fall campaign? Duh.

OBAMA: Hi. This is Barack Obama. I have an important announcement, and I wanted all of you, the people who built this movement from the bottom up, to hear it first. We've made the decision not to participate in the public financing system for the general election.

CROWLEY: In a Web video announcement, which includes a handy donate link, Barack Obama made history. He will become the first presidential nominee to refuse public financing in a general campaign. Legal and expected, all would be OK except for the video trail of this kind of thing, dateline: New Hampshire, April 2007.

OBAMA: I have been a public supporter of public financing since I got into politics.

CROWLEY: And in late November, Obama responded to and then signed a questionnaire, stating, "I will aggressively pursue an agreement with the Republican nominee to preserve a publicly financed general election."

A decided underdog in the money chase, John McCain still believes he has a political issue.

McCAIN: And this is a big deal. It's a big deal. He has completely reversed himself and gone back not on his word to me, but the commitment that he made to the American people. That's disturbing.

CROWLEY: Aboard the very symbolic Straight Talk Express, McCain drew the bright line, telling reporters he will take public funding because he said he would.

McCain's campaign helpfully provided a timeline of Obama's evolution on the subject, while the Republican National Committee plucked some primary quotes from Hillary Clinton shortly after Obama began to send off signals he would opt out of the campaign finance system.

"Now," she said, we're seeing how the words don't even mean what we thought they meant."

Lawyers for both campaigns have slightly different versions on whether there was ever any serious talk about an agreement. But it doesn't change the bottom line. This fall, Obama will be able to spend what he can raise, the fuel he needs as he tries to define himself to a public still learning about him.

The first ad of his general campaign goes up Friday.

OBAMA: And if I have the honor of taking the oath of office as president, it will be with a deep and abiding faith in the country I love.

CROWLEY: Obama's decision not to take public funding is criticized even by some friends as a mistake. And it's hard to spin his position as anything other than a 180. But Obama advisers try. They argue the campaign is the reform everyone talks about, fueled largely by low-dollar donations from donors who don't even expect a thank-you note in return. Candy Crowley, CNN, Washington.

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Matt Gertz is Research Director at Media Matters. He has written extensively on media coverage of the Benghazi attacks, gun violence, voting rights, LGBT issues, and elections, as well as on media ethics. He joined Media Matters in 2007 and holds a B.A. in political science from Columbia University.

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